The following list includes the 10 items you are likely to need when preparing your tax return. Although you may be required to provide additional information, this list brings you the most common items we have identified based on hundreds of our clients tax returns. 1. IRS form W2 summarizes your annual taxable wages, federal income tax withheld, social security withheld, Medicare withheld and state income tax withheld. Additionally your contribution to an employer based retirement plan is also listed on the W2. 2. Rental Income and Expenses, Cost of Property, Date property placed in service Rental income include actual payments received by the tenants during the tax year. As a cash basis tax payer, do not include any payments still owed by the tenant for the year, only payments received. Rental expenses include: management fees, mortgage interest, insurance, condo fee, cleaning, utilities, advertising, travel to and from the property, real estate taxes, legal and other professional fees and brokerage commissions. Cost of property and date placed in service are necessary to calculate depreciation. 3. Family members: Names, DOB, Social Security Numbers, Full Address - To calculate personal exemptions, child tax credit, education credit, and child care expanse credit. Additionally EIC (Earned Income Tax Credit) is also calculated using this information. 4. Mortgage Interest Payments in 2005 (or form 1098) form 1098 summarizes your annual mortgage interest payments and any real estate taxes paid through your mortgage escrow account. 5. Property tax payments in 2005 (or form 1098) - If you pay your real estate taxes independently of the mortgage escrow account you will need copy of your property tax year for the year or copies of cancelled check with which you paid your property tax. 6. Child care expenses paid in 2005 (for each child and per child care provider) - The information necessary to calculate child care expenses credit includes names and social security numbers of the children, names, addresses and tax ID numbers of the day care providers. 7. Amount of money taken out from 401K (or form 1099-R) - The IRS requires that your 401K company reports to you on IRS Form 1099-R any distributions that you took from your retirement plan last year even if you rolled them into another plan. The same information must be submitted to the IRS. 8. Interest / Dividend Income (US or foreign) (form 1099-INT, 1099-DIV) - Those forms summarizes the interest and dividend payments you have received during the year from your bank, brokerage firm or any other U.S. source. The information provided to you is also submitted to the IRS. 9. Stock Sales and cost (form 1099-B) - Summarizes the proceeds you have received from selling stocks during the year. The form lists the symbol of the stock sold, date of sale and number of units sold, proceeds received and commission paid. To calculate capital gains or losses you must assign cost to each of the stocks you have sold, and then need to group the stocks into 2 categories: long term (stocks held for a year or more) and short term (stocks held for less than a year). 10. Business Income and Expenses (or employee un-reimbursed expenses) - Home office if you use portion of your residency as home office
Job search resume writing, interview travels, fax and phone calls, retainer paid to a job search firm
Professional expenses courses and licenses
Investment expenses margin interest
Travel business travel or work related travel
Seminars to keep you up to speed
Professional literature books to maintain your experience and knowledge
Tax preparation expenses payments to tax advisor or tax software
Legal expenses if it was paid to generate income |
